2 commissioners lend support for Daytona speedway tax breaks

Published: Wednesday, April 10, 2013 at 9:35 a.m.

Last Modified: Thursday, April 11, 2013 at 4:10 p.m.

A pair of Marion County commissioners recently made a pit stop in Tallahassee, lending support to a plan to give the operators of Daytona International Speedway tens of millions of dollars in tax breaks.

Commissioners Stan McClain and David Moore attended Monday’s hearing of the state Senate Commerce and Tourism Committee, which was vetting a bill that over time could net the world-renowned raceway about $70 million.

The measure, introduced by Sen. Dorothy Hukill, would permit International Speedway Corp., the parent company that operates the track, to reap $2 million a year for 30 years in sales tax rebates related to its events.

The company could also qualify for an estimated $10 million in refunded sales taxes levied on purchases of construction materials tied to a makeover for the facility that, according to news reports, is estimated at $450 million.

Hukill’s bill requires that the speedway spend $250 million on the renovation over four years before qualifying for that tax break.

Hukill, a Port Orange Republican who represents much of eastern Marion, told the committee no taxpayer dollars were at stake because the renovation would be privately financed.

She noted that the race track generates $1.6 billion annually in economic benefits to the region and promotes the employment of 18,000 people across Central Florida.

That activity results from the track being used some 250 days a year, Hukill said.

On occasions like NASCAR’s featured event, the Daytona 500, racing fans — 60 percent of whom come from out of state — spend on average at least five days in the region during their stay, Hukill said.

The 54-year-old race track needs a “major facelift,” added Hukill, and this one would provide 4,200 “high-end” construction jobs as part of the hundreds of millions of dollars in new investment.

The Daytona News-Journal has reported that besides upgrading the grandstands along its front stretch and adding seats there, International Speedway Corp. also intends to build new escalators and elevators, erect five entrances for the facility and eventually include hotels, restaurants, movie theaters and shops.

Daytona, Hukill said, has been the “premier event” for NASCAR fans for a half-century. “And we want it to remain that way for the next 50 years and beyond,” she added.

Proponents of the bill note that other Florida professional sports franchises have had a similar deal with the state for up to two decades.

And the raceway this year is competing against requests from the Miami Dolphins and Jacksonville Jaguars, both of which seek tax breaks for construction at their respective stadiums.

Sen. Alan Hays, a Umatilla Republican who represents southern Marion, told the committee on Monday that the project would invite fresh spending by outside visitors and not just be “re-churning” dollars from the community.

Besides Marion County’s board, the tax breaks received support from at least one other local government.

“We need a shot in the arm in Central Florida. We need a shot in the arm in our region,” Lake County Commission Chairwoman Leslie Campione told the Senate committee on Monday.

McClain and Moore did not speak when called by Sen. Nancy Detert, the Venice Republican who chairs the commerce committee. But both told Detert that while waiving an opportunity to comment on Hukill’s measure, they did support it.

On Tuesday, McClain said he voiced support for the bill because he thinks the project could capture some of the “collateral traffic” passing through Marion County, especially for an event as popular as the Daytona 500.

One key beneficiary would be the Silver Springs area, McClain said. The attraction is slated to become part of Silver River State Park come Oct. 1, and county officials are vying to be the lead concessionaire for many of the future services offered there.

“From a Silver Springs perspective,” McClain said, “the thought process is that we could set up some of the events around their stuff.”

McClain, recalling comments from the meeting, pointed out that International Speedway Corp. wants to make the area a hub for motorsports research, and those projects might also bring some “manufacturing opportunities” to Marion County.

McClain observed that the big events draw visitors to the area for a considerable stay, and Marion might also capture some economic spillover from patrons seeking activities aside from racing.

The News-Journal reported on Monday that International Speedway Corp. had announced that its first quarter profit ran to $13.5 million, which was down about $3.6 million over the same time frame in 2012.

However, the company, which owns race tracks in California, Michigan and Florida as well as the Hollywood Casino at Kansas Speedway, reported that its total revenue for the first quarter of 2013 was $128.6 million, up $1.2 million over the same period a year ago.

McClain said he was not concerned about appearing to back tax breaks for a wealthy company.

The rewards to Daytona’s operators are all “performance-driven,” based on their ability to meet stringent targets, he noted. Moreover, the project is privately funded, and International Speedway Corp. only seeks the tax breaks to have a “level playing field” with other Florida sports franchises, he said.

McClain did not have hard data on how many visitors Daytona International Speedway pulls to Marion County, but said a study by Commissioner Carl Zalak about the local economic impact of motor sports was in the works.

The project at the raceway would generate billions of dollars in new consumer spending — with an estimate of about $125 million a year over three decades across the region — and thus new taxes, McClain said.

Moore also cited the economic benefits, saying the raceway project would have a “residual effect” in Marion. That meant creating jobs.

Moore also observed that Daytona’s eventual “entertainment complex” would be more family-oriented, and that too would help the community.

“Where are the families going to be” when the races are held, Moore suggested. “Marion County.”

As for the tax breaks, Moore noted, “It gives them an incentive to do the work.”

The Marion commissioners’ championing tax breaks for a project more than 70 miles from Ocala comes two months after they both suggested more people needed to help finance government.

In February, the board voted down a plan to enact Amendment 11, a property tax break for people 65 and older who own a home with a market value of less than $250,000, have lived there at least 25 years and have a household income of less than $27,030.

County officials estimated the cost of the tax break at about $162,000 in the first year.

At the time, McClain voted against Amendment 11 suggesting the property tax system was unfair and contained too many exemptions. The government needed to shift toward a system like the Fair Tax, the proposed national sales tax that would replace most federal taxes, he argued.

Moore voted for Amendment 11, but said he did so reluctantly.

He said during the debate that he believed Amendment 11 would help elderly people. But, he added, he was also concerned about giving tax breaks to “small segments” of the population.

<p>A pair of Marion County commissioners recently made a pit stop in Tallahassee, lending support to a plan to give the operators of Daytona International Speedway tens of millions of dollars in tax breaks.</p><p>Commissioners Stan McClain and David Moore attended Monday's hearing of the state Senate Commerce and Tourism Committee, which was vetting a bill that over time could net the world-renowned raceway about $70 million.</p><p>The measure, introduced by Sen. Dorothy Hukill, would permit International Speedway Corp., the parent company that operates the track, to reap $2 million a year for 30 years in sales tax rebates related to its events.</p><p>The company could also qualify for an estimated $10 million in refunded sales taxes levied on purchases of construction materials tied to a makeover for the facility that, according to news reports, is estimated at $450 million.</p><p>Hukill's bill requires that the speedway spend $250 million on the renovation over four years before qualifying for that tax break.</p><p>Hukill, a Port Orange Republican who represents much of eastern Marion, told the committee no taxpayer dollars were at stake because the renovation would be privately financed.</p><p>She noted that the race track generates $1.6 billion annually in economic benefits to the region and promotes the employment of 18,000 people across Central Florida.</p><p>That activity results from the track being used some 250 days a year, Hukill said.</p><p>On occasions like NASCAR's featured event, the Daytona 500, racing fans — 60 percent of whom come from out of state — spend on average at least five days in the region during their stay, Hukill said.</p><p>The 54-year-old race track needs a “major facelift,” added Hukill, and this one would provide 4,200 “high-end” construction jobs as part of the hundreds of millions of dollars in new investment.</p><p>The Daytona News-Journal has reported that besides upgrading the grandstands along its front stretch and adding seats there, International Speedway Corp. also intends to build new escalators and elevators, erect five entrances for the facility and eventually include hotels, restaurants, movie theaters and shops.</p><p>Daytona, Hukill said, has been the “premier event” for NASCAR fans for a half-century. “And we want it to remain that way for the next 50 years and beyond,” she added.</p><p>Proponents of the bill note that other Florida professional sports franchises have had a similar deal with the state for up to two decades.</p><p>And the raceway this year is competing against requests from the Miami Dolphins and Jacksonville Jaguars, both of which seek tax breaks for construction at their respective stadiums.</p><p>Sen. Alan Hays, a Umatilla Republican who represents southern Marion, told the committee on Monday that the project would invite fresh spending by outside visitors and not just be “re-churning” dollars from the community.</p><p>Besides Marion County's board, the tax breaks received support from at least one other local government.</p><p>“We need a shot in the arm in Central Florida. We need a shot in the arm in our region,” Lake County Commission Chairwoman Leslie Campione told the Senate committee on Monday.</p><p>McClain and Moore did not speak when called by Sen. Nancy Detert, the Venice Republican who chairs the commerce committee. But both told Detert that while waiving an opportunity to comment on Hukill's measure, they did support it.</p><p>On Tuesday, McClain said he voiced support for the bill because he thinks the project could capture some of the “collateral traffic” passing through Marion County, especially for an event as popular as the Daytona 500.</p><p>One key beneficiary would be the Silver Springs area, McClain said. The attraction is slated to become part of Silver River State Park come Oct. 1, and county officials are vying to be the lead concessionaire for many of the future services offered there.</p><p>“From a Silver Springs perspective,” McClain said, “the thought process is that we could set up some of the events around their stuff.”</p><p>McClain, recalling comments from the meeting, pointed out that International Speedway Corp. wants to make the area a hub for motorsports research, and those projects might also bring some “manufacturing opportunities” to Marion County.</p><p>McClain observed that the big events draw visitors to the area for a considerable stay, and Marion might also capture some economic spillover from patrons seeking activities aside from racing.</p><p>The News-Journal reported on Monday that International Speedway Corp. had announced that its first quarter profit ran to $13.5 million, which was down about $3.6 million over the same time frame in 2012.</p><p>However, the company, which owns race tracks in California, Michigan and Florida as well as the Hollywood Casino at Kansas Speedway, reported that its total revenue for the first quarter of 2013 was $128.6 million, up $1.2 million over the same period a year ago.</p><p>McClain said he was not concerned about appearing to back tax breaks for a wealthy company.</p><p>The rewards to Daytona's operators are all “performance-driven,” based on their ability to meet stringent targets, he noted. Moreover, the project is privately funded, and International Speedway Corp. only seeks the tax breaks to have a “level playing field” with other Florida sports franchises, he said.</p><p>McClain did not have hard data on how many visitors Daytona International Speedway pulls to Marion County, but said a study by Commissioner Carl Zalak about the local economic impact of motor sports was in the works.</p><p>The project at the raceway would generate billions of dollars in new consumer spending — with an estimate of about $125 million a year over three decades across the region — and thus new taxes, McClain said.</p><p>Moore also cited the economic benefits, saying the raceway project would have a “residual effect” in Marion. That meant creating jobs.</p><p>Moore also observed that Daytona's eventual “entertainment complex” would be more family-oriented, and that too would help the community.</p><p>“Where are the families going to be” when the races are held, Moore suggested. “Marion County.”</p><p>As for the tax breaks, Moore noted, “It gives them an incentive to do the work.”</p><p>The Marion commissioners' championing tax breaks for a project more than 70 miles from Ocala comes two months after they both suggested more people needed to help finance government.</p><p>In February, the board voted down a plan to enact Amendment 11, a property tax break for people 65 and older who own a home with a market value of less than $250,000, have lived there at least 25 years and have a household income of less than $27,030.</p><p>County officials estimated the cost of the tax break at about $162,000 in the first year.</p><p>At the time, McClain voted against Amendment 11 suggesting the property tax system was unfair and contained too many exemptions. The government needed to shift toward a system like the Fair Tax, the proposed national sales tax that would replace most federal taxes, he argued.</p><p>Moore voted for Amendment 11, but said he did so reluctantly.</p><p>He said during the debate that he believed Amendment 11 would help elderly people. But, he added, he was also concerned about giving tax breaks to “small segments” of the population.</p><p><i>Contact Bill Thompson at 867-4117 or at bill.thompson@starbanner.com.</i></p>